Radio Rallies & Reversals

I've said it before and I'll say it again - The stock market and the economy are not the same thing. While they are inter-connected, the stock market is a leading indicator of the economy, and right now it's getting interesting. We've seen some economic numbers which suggest Western economies are rolling over, but the stock market seems to shrug it off. Good news or bad news, the stock market is sustaining its push higher. It seems that if the economic numbers are poor, the market cheers because this increases the chance of quantitative easing; If the economic numbers are good, the market cheers because corporate profits are growing. This is what happens when government tinkers with the system, and that's an understatement. Our children and grandchildren are the ones who are going to have to pick up the bill for all our partying. If we're smart, we'll at least save them a piece of cake.

Speaking of economic numbers and corporate profits, the market has been waiting to sink its teeth into the recent FOMC meeting minutes just released. The early analysis is that more stimulus is on the way, and the market seems to like it as North American stock indexes have all moved from red to green; although, investors will be chewing on this a bit more. After the bell, Intel will continue the next round of earnings reports following Alcoa last week.

GB